News & Commentary:

October 2004 Archives

Articles/Commentary

Energy Empire: Oil, Gas and Russia's RevivalFiona Hill (Brookings/Foreign Policy) Sep/Oct 2004
Russia is back on the global strategic and economic map. It has transformed itself from a defunct military superpower into a new energy superpower. Energy revenues no longer support a massive military-industrial complex as they did in the Soviet period. New oil wealth has been turned more into butter than guns. And after five years of economic growth, Russia has a new 'soft power' role that extends far beyond its energy resources. Instead of the Red Army, the penetrating forces of Russian power in Ukraine, the Caucasus, and Central Asia are now Russian natural gas and the giant gas monopoly, Gazprom, as well as Russian electricity and the huge energy company, UES—and Russian culture and consumer goods.

Too Much ConsensusForeign Policy Sep/Oct 2004
Ever since the Washington Consensus became the hottest brand on the policy block, wonks of the world have competed to define their idea as the next big thing. And what better way to market your idea than to tag it a “consensus,” suggesting that it’s a grand unifying theory? In an attempt to help you sort through the hype, FP presents its exclusive Field Guide to the Consensuses.

European Integration, UnpluggedForeign Policy Sep/Oct 2004
Most of the 14,000 inhabitants of Elektrenai, Lithuania, voted to join the European Union in May 2003 because membership promised a better life. In some ways, however, their European future looks a lot like their Soviet past, with new bureaucratic masters, new rules, and the revival of a giant power plant that once made their town a model of state socialism. A parable about the promises and pitfalls of European integration.

NGOs: Fighting Poverty, Hurting the PoorSebastian Mallaby (FP) Sep/Oct 2004
A plague of activists is tormenting international aid agencies, deploying celebrities, politicians, and disinformation in a fight against projects it says exploit the developing world. These campaigns keep causes in the spotlight, but they harm the very people activists claim to help.

The Venezuelan Oil CrisisMichelle Billig (Foreign Affairs) Sep/Oct 2004
Last year's crisis in Caracas caught Washington by surprise, causing oil prices to skyrocket and exposing flaws in the U.S. ability to forecast and cope with threats to its oil supply. Both government and industry must do better next time.

Why Democracies ExcelJoseph T. Siegle, Michael M. Weinstein & Morton H. Halperin (Foreign Affairs) Sep/Oct 2004
U.S. and international development agencies, believing that poor countries should develop economically before they become democratic, have not taken politics into account when disbursing aid. This is a mistake: poor democracies are almost always stronger, calmer, and more caring than poor autocracies, because they allow power to be shared and encourage openness and accountability. They deserve all the help they can get.

The Miracles of GlobalizationArvind Panagariya (Foreign Affairs) Sep/Oct 2004
By the early 1980s, a number of distinguished economists had amassed compelling evidence that outward-oriented trade policies were far more likely than protectionism to lead to economic growth. The evidence was contained in two multi-country research projects-one at the Organization for Economic Cooperation and Development (OECD), led by Ian Little and others, and the other at the National Bureau of Economic Research, directed by Jagdish Bhagwati and Anne Krueger-and in a series of studies at the World Bank.

Above the law? Battle over World Bank immunity in BangladeshBretton Woods Update Number 42 Sep/Oct 2004
Plus: Parliaments reign in IFIs: International campaign gains momentum; All sides agree urgent need for governance reforms; Contradictions in the Bank's India strategy; Country ownership of PRSPs is restricted to "officialdom"; Two decades of environmental & social protection policies at risk; Private sector safeguard review "fundamentally flawed"; Inside the institutions, and more.

Free trade is not all it's cracked up to beRobert Kuttner (Boston Globe/IHT) Oct 1, 2004
When Paul Samuelson, the dean of American economists, begins questioning the benefits of free trade, it is a bit like the pope having doubts about the virgin birth. But Samuelson, a Nobel laureate and the author of America's best-known economics textbook, has reopened a debate on the most settled issue in economics. He's done it with a stunner of an article in the Journal of Economic Perspectives that has created immense controversy - and an opportunity for Americans and others to rethink previously unchallenged assumptions.

Job outsourcing? No crisis hereDaniel W. Drezner (NYT/IHT) Oct 1, 2004
John Kerry is making the outsourcing of jobs by American companies a centerpiece of his campaign, telling audiences that "because of George Bush's wrong choices, this country is continuing to ship good jobs overseas." President Bush's team has in turn accused the senator of hypocrisy, noting that many of Kerry's supporters in the business world run companies that are sending jobs offshore. Yet as each side angles for votes, neither is addressing the real issue: Is the outsourcing of jobs a problem? The answer, surprisingly, is no.

Ending the Cycle of DebtNYT Oct 1, 2004
The G-8 should endorse the plan of the United States and Great Britain to cancel the debts of the world's 30 poorest countries.

Global: China Meets the G-7Stephen Roach (MSDW) Oct 1, 2004
By inviting China to participate in the upcoming G-7 discussions in Washington, the club of rich nations is acknowledging something that the rest of Asia has known for a long time: The world is finally recognizing the existence of a renminbi bloc. The key question for the G-7 and Asia is whether China is up to the task in managing this new currency zone.

United States: Upside Risks for the US Current AccountRichard Berner (MSDW) Oct 1, 2004
Only three months ago, I warned that the US current account deficit — the imbalance with the rest of the world in trade in goods and services, investment income, and transfers — might not peak until it reached 6% of GDP (see “When Will the Current Account Peak?” Global Economic Forum, June 25, 2004). I now think I was too optimistic. Despite a healthy July rebound in export growth, it now appears that the red ink could reach 6½% of GDP before stabilizing and subsequently shrinking.

Global: Will Oil Prices Peak at $50?Richard Berner/Eric Chaney (MSDW) Oct 4, 2004
We are boosting our oil price assumptions significantly. We now assume Brent crude will peak at $50/bbl in October, about $10 higher than the peak in our last update in July (West Texas Intermediate, a lighter, “sweeter” crude, may peak $3-4 higher). To be sure, markets are still taut, and further supply shocks could temporarily push prices even higher. But a $50 price for crude and roughly parallel increases for product quotes will begin to curb demand as it taxes global consumers, and is already spurring some US refinery de-bottlenecking. And just as the near-term price-insensitivity of demand contributed to rapid price hikes, so too does it offer the likelihood of rapid declines when demand growth slows. Consequently, we now expect that prices from that higher level will decline more sharply over the next year to what we think of as the midpoint of a $30-$40/bbl equilibrium range. Even so, we expect that the average level of crude prices in 2005 will be nearly $4 higher than we thought just two months ago.

Global: StagflationJoachim Fels (MSDW) Oct 4, 2004
The recent renewed run-up in oil prices makes me even firmer in my belief that the world economy is headed for a stagflationary outcome. Just as the 1990s was a period of stronger-than-expected economic growth and lower-than-expected inflation, the next several years are likely to produce the opposite scenario, in my view: slower-than-expected economic growth coupled with higher-than-expected inflation. In many ways, the current macro backdrop resembles that of the 1970s, when the world economy experienced its first serious bout of stagflation (see my Back to the Seventies, 14 May 2004). Needless to say, if this scenario came to pass, both equity and bond markets would severely suffer, just as they did in the decade of platform shoes, Saturday Night Fever and KISS (remember?).

‘Beyond the crossroads: moving forward on the Doha Development Agenda’WTO Oct 4, 2004
Supachai Panitchpakdi, in his address to the Parliamentary Assembly of the Council of Europe in Strasbourg on 4 October 2004, said that the July Decision on the Doha negotiations has “shown the scale of the potential gains and has provided a roadmap to their realization”. He underlined the important role of parliamentarians in the WTO.

Trade chief of EU takes U.S. to taskIHT Oct 5, 2004
The incoming European Union trade commissioner, Peter Mandelson, on Monday criticized the United States for failing to stick to bilateral talks to resolve a dispute over government aid to Boeing and Airbus.

Mixed Signals Are Bad for TradeRobert B. Zoellick (WSJ) Oct 5, 2004
Mr. Kerry's profile on trade does not auger well for leadership -- his own or America's.

Debt relief enters election frayAT Oct 6, 2004
The issue of debt writeoff for poor countries has left the activists' domain to enter the political mainstream, with both presidential candidates in the US making it a campaign plank. Both, probably, have understood that it makes far more economic sense to cancel this debt than collect it.

The workplace: Differences in nations are strikingIHT Oct 6, 2004
There is a long tradition in Europe of trying to divide the Continent into two types of people: northerners who favor butter versus southerners who prefer olive oil; friendly Mediterranean people versus the reserved Nordic types.

Oil FantasiesWP Oct 6, 2004
The recent surge in oil prices to roughly $50 a barrel teaches some useful lessons. One is that surprises happen. A year ago futures contracts predicted today's price would be $25. A second is that the economy has grown less vulnerable to oil "shocks." Compared with 1973, we now use almost 50 percent less energy for each dollar of output. New industries (software, theme parks) need less than the old (steel, chemicals). But the largest lesson is depressingly familiar. Americans won't think realistically about oil. We consider cheap fuel a birthright, and when we don't get it, we whine -- rather than ask why or what we should do.

Is Your Job Coming to India? Get Used to ItWilliam Pesek Jr. (Bloomberg) Oct 6, 2004
George W. Bush and John Kerry sure did span the globe in their first presidential debate when they argued who would make a better U.S. leader. Afghanistan, China, France, Germany, Iran, Iraq, Japan, Liberia, Libya, Mexico, North Korea, Pakistan, Poland, Russia, Rwanda, South Korea, Sudan and the U.K. all came up last Thursday. Yet it's equally interesting that neither candidate mentioned one very relevant country: India.

Moving Forward The 'Development Agenda' In WIPOBRIDGES Weekly Trade News Digest - Vol. 8, Number 33 Oct 6, 2004
In response to a proposal put forward by Brazil and Argentina, the World Intellectual Property Organization's (WIPO) General Assembly (GA), taking place from 29 September to 5 October in Geneva, adopted a decision to move forward the discussions on a 'development agenda' in WIPO by initiating a series of inter-sessional meetings, which will report to the next General Assembly. Discussions also took place regarding the current work on the Substantive Patent Law Treaty (SPLT), the increase of Patent Cooperation Treaty (PCT) fees and a WIPO response to a request for information by the Parties to the Convention on Biological Diversity (CBD) on the relationship between the disclosure of origin and intellectual property.

WTO Agriculture Session Addresses Next Steps From July FrameworkBRIDGES Weekly Trade News Digest - Vol. 8, Number 33 Oct 6, 2004
Following on from an informal meeting on 24 September, WTO Members convened on 6 October for an informal special (negotiating) session of the Committee on Agriculture. Discussions, chaired by Ambassador Tim Groser of New Zealand, focused mainly on how to carry the momentum forward from the recent July framework agreement. The July agreement, which gave a much-needed boost to the Doha Round, established a framework for conducting future substantive trade negotiations, including in agriculture. The informal talks are being held in advance of a formal special session of the Committee on Agriculture on 8 October.

WTO Development Committee Focuses On Technical Assistance, Commodities, SustainabilityBRIDGES Weekly Trade News Digest - Vol. 8, Number 33 Oct 6, 2004
The WTO Committee on Trade and Development (CTD) met on 28-29 September to continue discussions on technical assistance for the upcoming year, declining commodity prices, and the operationalisation of Doha Declaration paragraph 51 on sustainable development. Chaired by Ambassador Trevor Clarke (Barbados), delegates also discussed the graduation of WTO Members from least-developed country (LDC) status.

WTO Members Brace For Textile Quota LiberalisationBRIDGES Weekly Trade News Digest - Vol. 8, Number 33 Oct 6, 2004
WTO Member countries are preparing a variety of different initiatives intended to ease the impact of the phase-out of textile and clothing quotas at the end of this year. At a WTO Goods Council meeting on 1 October, seven countries submitted a proposal for WTO action to address the impact of the upcoming elimination of quotas on their fragile textile and clothing industries. The proposal -- from Bangladesh, Mauritius, the Dominican Republic, Fiji, Madagascar, Sri Lanka and Uganda -- asks the WTO Secretariat to prepare a study on adjustment-related issues and costs arising from quota elimination and to establish a WTO work programme to discuss possible solutions to the problems identified in the study.

Global: Canary in the Coal MineStephen Roach (MSDW) Oct 8, 2004
While financial markets have been relatively blasé about the unrelenting surge in oil prices, the global economy is not. Activity now seems to be sputtering in many segments of the world. That's true in Asia and Europe, although the US economy remains something of an outlier for now. But with oil prices at a flash point, resilience is likely to become an increasingly scarce commodity in a still-unbalanced and vulnerable global economy. The outlook for 2005 continues to darken.

Dogfight at the WTOFT Oct 8, 2004
The US and the EU have been sparring over the questiopn of subsidies for Boeing and Airbus for four years. So what triggered the US decision to take the issue to the World Trade Organisation, and risk escalation?

Global: Danger ZoneStephen Roach (MSDW) Oct 11, 2004
As the odds of a full-blown oil shock rise, we have little choice other than to cut our global growth forecast. Our first revision is a relatively small one: We are reducing our 3.9% estimate of world GDP growth for 2005 by 0.3 percentage point to 3.6%. Yet there is more to this revision than meets the eye. This relatively modest cut to our annual growth numbers masks a worrisome shortfall we now anticipate in early 2005 -- a shortfall that pushes the global growth rate down to its “stall speed.” History tells us that is a very precarious place to be -- it doesn’t take much to tip a stalling global economy into outright recession. As I see it, that remains the major risk as we peer into 2005.

Is India Facing Argentina-Like Debt Crisis?William Pesek Jr. (Bloomberg) Oct 13, 2004
Communist. Socialist. Pro-poor. That India's five-month old government has been called these names and worse should spook bond investors. These are, after all, people who tend to panic over politicians who spend ever-increasing amounts of money, most of it borrowed.

EMEA: Resilient To High Crude PricesRiccardo Barbieri, Serhan Cevik, Oliver Weeks (MSDW) Oct 13, 2004
Global growth forecast cut on the back of a higher oil price scenario. Oil prices have been undoubtedly the key economic surprise in the world economy this year, continuing their rise even as projections for world and Asian economic growth were being trimmed. Our global economics team this week unveiled a new GDP forecast that takes stock of the upward revision to the oil price scenario we announced last week. The global real GDP growth forecast for 2004 rises from 4.7% to 4.8%, but, more importantly, the projection for next year declines from 3.9% to 3.6%. Our global chief economist Steve Roach personally feels that even this assessment is optimistic, and sees a 40% probability of a global recession, meaning world growth of less than 2.5% in 2005.

Need For Technical Work, Policy Space Stressed In Doha Round Oversight BodyBRIDGES Weekly Trade News Digest - Vol. 8, Number 34 Oct 13, 2004
On 12 October, the WTO Trade Negotiations Committee (TNC) met to take stock of Doha round negotiations and discuss the concerns of Members. The session was the first TNC meeting since the agreement of the so-called "July package" almost three months ago, which effectively breathed new life into the struggling Doha round of trade negotiations. The TNC meeting included statements by TNC Chair and WTO Director-General Supachai Panitchpakdi, as well as the Chairs of the various negotiating groups established under the TNC. Several interventions were made by Members regarding upcoming negotiations.

CITES Expands Coverage, Discusses Wildlife Trafficking, Ivory, DNABRIDGES Weekly Trade News Digest - Vol. 8, Number 34 Oct 13, 2004
Key decisions were made this week at the 2-14 October Conference of the Parties (COP) to the Convention on International Trade in Endangered Species of Wild Flora and Fauna (CITES) in Bangkok, Thailand. These included decisions on a Southeast Asian initiative to combat wildlife trafficking, the regulation of a number of heavily-traded species, and cross-cutting issues. CITES is one of several multilateral environmental agreements (MEAs) currently being discussed at the WTO, where Members are negotiating on the relationship between MEAs and multilateral trade rules as part of the Doha round. The 13th CITES COP provides an opportunity for parties to the agreement to review restrictions on trade in endangered species or propose new ones by listing them on CITES 'Appendices I, II, or III,' or through action plans. Animal and plant species listed under CITES Appendix I are considered highly threatened with extinction, and are excluded from trade, except in very special circumstances, while Appendix II species are subject to strictly regulated trade on the basis of quotas and permits to ensure that trade does not compromise their survival. Appendix III lists species that are subject to domestic regulation, and for which a Party requests the cooperation of other Parties to control international trade.

WTO Agriculture Talks Inch ForwardBRIDGES Weekly Trade News Digest - Vol. 8, Number 34 Oct 13, 2004
Trade delegates met in a special (negotiating) session of the WTO Committee on Agriculture on 8 October to wrap up three days of talks. The talks, which had started on 6 October, focused mainly on the process for bringing forward the negotiations following a framework deal agreed in July. The Chair, Ambassador Tim Groser of New Zealand, gave his assessment of the situation, and outlined a plan for future work, which will be technical in nature.

Ominous: The deficit vs the dollarJack Crooks (AT) Oct 14, 2004
The United States deficit is good, but it is also bad; so goes conventional doublethink. But an examination of the financial realities and the implications of the US current-account deficit makes it clear that the dollar is poised to be overwhelmed by the deficit. The only question is not if, but when.

Forex boost to India's infrastructureKunal Kumar Kundu (AT) Oct 14, 2004
The new Indian government wants to replicate the model of the Asian Tigers by pumping some of its bulging forex reserves into crumbling infrastructure. It's a lofty goal and, for it to succeed, institutional hurdles that have landed infrastructure in such a mess in the first place will have to be removed.

That Cloud Over the United NationsNYT Oct 14, 2004
While it is important to track down any corruption in Iraq's oil-for-food program, it's also important to remember that the sanctions worked.

The China EffectWP Oct 14, 2004
The political debate on China has been mainly about the threat to American jobs. This threat is exaggerated: China specializes in low-wage, labor-intensive manufacturing; the United States is a high-wage, capital-intensive economy; Chinese competition is more likely to displace workers in Mexico than here. But the recent spike in oil prices points to a different mechanism through which China can affect U.S. interests. Surging economic growth in China is accompanied by surging demand for oil: China accounts for nearly two-fifths of the worldwide increase in oil consumption since 2000. Hence one reason for high oil prices.

Many unhappy returnsEconomist Oct 15, 2004
While rich-world investors struggle to make decent returns, investors from emerging markets are lending to America as never before.

The world's bustling ports: Boxed in and clogged upEconomist Oct 15, 2004
Ports in the big western economies are getting clogged up by the rising volume of world trade. They will need to follow Asia’s example and spend more on building the infrastructure where it is needed.

The Dangers of Economic IsolationismGlobalist Oct 15, 2004
Are global companies losing the battle of public opinion over globalization? UPS's CEO Mike Eskew outlines five ways in which business should step up to the challenge. Also, Richard Phillips argues why Europeans would like the Bush Administration to continue in office. We also look at the ultimate form of U.S. outsourcing triggering a public health threat.

Global: Productivity Convergence?Stephen Roach (MSDW) Oct 15, 2004
It feels different in Europe. The pain of stagnation has evoked a powerful backlash that is finally driving meaningful structural reforms. Europe has nowhere to go but up, and that long and arduous journey now appears to be under way. America, by contrast, is at the top of its game -- coming off eight fat years the likes of which most leading economies have rarely seen. But now burdened with an unprecedented shortfall of national saving, a record current-account deficit, and a massive overhang of debt, it will be exceedingly difficult for the US to keep the magic alive. At work over the next several years could well be the beginning of a stunning productivity convergence between the US and Europe -- a shift that could have profound implications for the global economy, financial markets, and currencies.

Why India Needs Stronger Currency. Asia, TooWilliam Pesek Jr. (Bloomberg) Oct 18, 2004
On Oct. 12, a small conference was convened here in New Delhi on India's huge debt load. The focus was on the need for the new government to be more open and avoid the backroom maneuvers that left Asia's No. 4 economy so indebted.

America's Big Challenge: AsiaFareed Zakaria (WP) Oct 19, 2004
The presidential debates are lauded for having been substantive and revealing. In particular, people have noted how rare it is to have a serious discussion about foreign policy these days. Except that we did not have a serious discussion about foreign policy. We had one about Iraq. And thousands of miles away, there is a new world coming into being -- one that America is quite unprepared to handle.

WTO Releases Final Ruling In EC Sugar CaseBRIDGES Weekly Trade News Digest - Vol. 8, Number 35 Oct 20, 2004
On 15 October the WTO panel in the case against the EC's export subsidies for sugar -- brought by Brazil, Thailand and Australia -- released its final report to the public. The report confirmed the panel's major findings, provided in earlier confidential rulings. The panel found that the EC subsidises sugar exports beyond the level formally notified to the WTO -- its so called commitment schedule -- and is in violation of the WTO Agreement on Agriculture (AoA). The panel further found that sugar exports above the EC's commitment level amount to the equivalent of the sugar imported under preferential arrangements from the African, Caribbean and Pacific (ACP) countries and India, as well as of sugar produced in excess of EC sugar quotas.

CTE Regular Session Discusses Market Access, Paragraph 51BRIDGES Weekly Trade News Digest - Vol. 8, Number 35 Oct 20, 2004
WTO Members, meeting on 14 October for the regular session of the Committee on Trade and Environment (CTE), discussed a new submission by the EC on addressing developing country concerns regarding the effects of environmental measures on market access. The Committee also debated an EC proposal to hold a workshop on paragraph 51, which mandates the CTE and the Committee on Trade and Development to ensure that sustainable development is adequately reflected in the negotiations.

Is it time for dollar to fall in Asia?Floyd Norris (IHT) Oct 22, 2004
What has gone wrong in the American economy in the past six months? That is not something that either presidential candidate has spent much time discussing, but the answers provide an indication of the major policy problems the victor will have to address next year.

Global: The Perils of Circular ThinkingStephen Roach (MSDW) Oct 22, 2004
We’re all guilty of it from time to time -- fudging an assumption in order to validate a conclusion. But I am worried that this is starting to become the norm in the circular thinking that now pervades financial markets. In particular, concerns over debt, current account imbalances, and oil have been dismissed all too quickly, in my view. It’s as if the world has discovered a new means to cope with the once intractable. Such was the folly of the New Paradigm when Nasdaq was cresting at 5000 in early 2000. And such could well be the folly again in ignoring critical risks now bearing down on the global economy.

Europe May Face Knockout Blow From Dollar DeclineMatthew Lynn (Bloomberg) Oct 22, 2004
As if things weren't tough enough for the euro-area economy, another villain appears on the scene threatening to deal a knockout blow to an export-driven recovery.

Lies, damn lies and Chinese statisticsFlorence Chan (AT) Oct 23, 2004
China has stunned the world with its economic miracle, reflected in its galloping GDP growth. But its figures are mostly pumped up by ambitious local bureaucrats who cook the books and waste money on infrastructure, making Chinese statistics inscrutable and often unreliable parameters of progress.

Iraq receives IMF financingIMF Survey Oct 25, 2004
Plus: Finding ways to boost public investment; Should hedge funds be regulated?; The effects of high debt; New director in Finance Department; Lawrence Summers on U.S. current account deficit; The WTO and poor countries

Dollar's fall lands hard in EuropeIHT Oct 26, 2004
Soaring oil prices and concerns about the U.S. economy are driving the dollar back toward historic lows against the euro.

Nourishing the Muslim worldIHT Oct 26, 2004
Three weeks ago, Pakistan's commerce minister met with his U.S. counterparts. His request was familiar: that the Bush administration lower the odious duties on underwear and shirts from Pakistan, and consider a free-trade pact with the predominantly Muslim country. The response was also familiar: no.

Textiles Consultations DeadlockedBRIDGES Weekly Trade News Digest - Vol. 8, Number 36 Oct 27, 2004
An informal meeting of the WTO Goods Council on 26 October ended in heated discussion and deadlock after Members failed to agree on measures to address concerns regarding the negative impact of the elimination of textile and clothing quotas. Following the meeting, Goods Council Chair Choi Hyuck (South Korea) said that agreement had not been reached on an initiative of ten developing countries for adjustment measures. He would nonetheless continue to consult with Members on the issue and report back to the formal meeting of the Goods Council on 11 November.

Informal Agriculture Talks Reveal Members' Differing PrioritiesBRIDGES Weekly Trade News Digest - Vol. 8, Number 36 Oct 27, 2004
WTO delegates met in an informal meeting on 25 October to exchange of views on the way forward in agriculture negotiations, focusing on technical issues to be addressed in the next special (negotiating) sessions of the Committee on Agriculture (CoA). Chaired by CoA regular session Chair Roald Lapperre (Venezuela), the meeting was open-ended and attended by delegates from all groups in the agriculture debate, including the EC, the G-20 developing countries, the G-33 group (favouring special products for developing countries), the G-10 group (comprising agriculture importers), and the Africa Group. Reportedly, the very informal meeting initiated by New Zealand revealed divergences among Members in terms of which technical issues first to address. CoA special session Chair Tim Groser has suggested that Members focus on a range of technical issues in the forthcoming negotiating sessions.

Will Cuba's dollar ban backfire?IHT Oct 28, 2004
Cuba's decision this week to strip the American dollar of its legal tender status may cause more problems than it solves for the country's already enfeebled economy.

Global: China TradeoffsStephen Roach (MSDW) Oct 29, 2004
China’s hike in interest rates is good news, in my view. It is a plus for an overheated Chinese economy, and it is a positive development for an unbalanced global economy. But there are always winners and losers when a nation opts for policy restraint. China is no exception. Three such tradeoffs loom particularly important in assessing the domestic and global implications of China’s monetary tightening.

Currencies: A Weak USD PreferenceStephen L Jen (MSDW) Oct 29, 2004
We remain constructive on the USD medium-term. Our forecasts are unchanged. However, the risk is rising of a shift in policy preference towards a weaker USD under the next US administration. This poses the single biggest risk to our USD call.

$200 Oil? It Could Be Asia's Gift to WorldWilliam Pesek Jr. (Bloomberg) Oct 29, 2004
The e-mail's subject line jumps right out at you: ``Anyone Willing to Forecast $200 Oil?'' The report by Action Economics LLC explores the worst-case scenario for energy markets in the years ahead.

China's rate riseFT Oct 29, 2004
Most central banks do not wait nine years between changes in interest rates. But most central banks do not have economies like China's to deal with.

The dismal failure of central bank monetary policyJack Crooks (AT) Oct 30, 2004
It was a cold, dreary autumn day at the central bank. The clocks struck 13. It was another reminder to visitors that all is possible in the neo-Keynesian puzzle palace. For he who controls the money controls the man.

China's Interest Rate Move Will Shake Yuan PegAndy Mukherjee (Bloomberg) Oct 31, 2004
It had been a topic of such intense speculation, and for so long, that when China did finally raise interest rates, the move was something of an anti-climax.